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Tuesday, September 19, 2017

Modular Housing Could Reinvent Single Family Home Rental Market

In 2015 Northern Nevada’s largest home builder, Lennar, opened its latest community of new, single-family, detached ‘built to rent’ (BTR) homes in Sparks, Nev.The 80 new houses at Frontera at Pioneer Meadows are available to rent, starting at $1,499 a month for a 1,210-sq.-ft. home and rising to $1,999 for 2,182 sq. ft.

The number of single-family homes intentionally built to be rental housing is still a tiny fraction of the home building overall, but it is growing quickly from effectively zero to become a new sector of the market for new development. Approximately 25,000 plus new detached homes are built for rent every year.

Build-to-rent is a relatively new concept in the UK also, with most developments historically built for sale rather than for renting. But developers have recently started to capitalise on demand for a different kind of product, and there are now 83,650 BTR homes completed or planned across the country.Currently, one-in-10 households live in single-family rental housing – that’s 12.7 million of the total 120 million households now living in the U.S. To serve these renters, leading master-planned community builders are likely to begin developing new, detached homes for rent.

Living in a “BTR” home means living in a development designed for renters: typically it has communal spaces, amenities like gyms and swimming pools, and some even have concierge service. Rents often include perks like high speed Internet and gym membership.This is another niche that could be filled by custom modular home factories. Building offsite makes a lot of sense for BTR developers as they can get an entire community in the ground quicker with less labor on site and better built homes.

Just like Marriott building more and more modular hotels after discovering the huge advantages afforded by modular construction. BTR developers could be the next big thing for modular housing.

These BTR developers have probably never given any thought to having their homes built offsite so it should be the factory salesperson that calls on commercial accounts to find the Lennars, Toll Brothers, Ryans, etc; and begin telling the advantages of modular.